Is it Easier to Pay off Debt or to Diet?

Greetings, friends! Today we have a guest post for you from fellow blogger, Sara Williams. Sara started the Debt Camel blog a few years ago where she chats about everything to do with debt in Britain, from mortgages and credit ratings to payday loans and bankruptcy. Enjoy!

Losing weight and getting out of debt have a lot in common. Keeping a spending diary is like tracking your calories, both need a lot of will power, crash methods usually fail pretty quickly.

And with both there will be some bad patches. Christmas can be a disaster for your waistline and your wallet!

But with dieting, the first few pounds are the easiest to shift – and then it gets harder and harder. With your debts, it’s the opposite. Here are four reasons why it’s easier to pay off debt than to diet.

1. The snowballing effect

Have you read about using the debt snowball method for clearing your debts? At the beginning, you are mostly paying off interest. But the debts are going down a bit, so the interest added each month will be dropping too.

Then the same payment the next month pays off more debt than the previous one did.

Your snowball is getting bigger as it rolls downhill. And the satisfaction of seeing the debts dropping gives you’re the encouragement to stick with it, even if there are some poor months.

As Laurie said in her Debt Payoff and Spending Update article: “Those first months and years might seem slow, and you might feel as if you’re going nowhere fast, but eventually your snowball will pick up steam and you’ll dump those debts, one by one.”

2. Improved credit rating

Reducing the interest through paying off capital isn’t the only effect that works in your favor.

At the start of your debt clearance, your credit score may not have been good. Even if you hadn’t missed payments, you may have been using a lot of your credit limits. But after the debts start going, your credit score will start improving.

And with less debt, you may soon be in a good enough position to get a 0% balance transfer card and the debt will be dropping even faster.

The dieting equivalent would be like saying that after 12 months of sticking to your diet a few of your favorite things will be exactly the same except they magically have fewer calories… it doesn’t happen!

3. You don’t have to think about debt every few hours

One of the biggest problems about dieting is that it is always on your mind. Every hour or two you are wondering what you will eat next, opening the fridge for some milk and seeing something you could eat, thinking about a half portion of something sinful, having to feed the kids at tea time without taking a bite… it never stops, all day, every day.

If you get organised it’s possible to limit the time you have to spend on your finances. The fewer times a week you have to mentally say No, I can’t afford that, the better as it’s exhausting and sometimes you just succumb to temptation.

So set up your big bill payments, including debts, to come out of your bank account on payday – it makes tracking your money much easier.

Apps like Mint in the USA and Money Dashboard and Squirrel in the UK can help make budgeting simpler and less time consuming. Apps such as Digit in the USA and Chip in the UK make it easy to put money aside during the month to snowball with at the end.

4. When you are debt free

When you have slimmed down to your target weight, most people need to keep a very close eye on their diet, or those unwanted pounds will soon be reappearing. Yes you can eat a bit more, but it’s all too easy to relax.

And if you have a good day or a good week, it doesn’t really help you out the next month.

With money, once you are debt free all that money you were spending on debt clearance is yours! Spend half and save half? Invest a third, put a third into fund for your next holiday/car, spend a third?

Starting to build savings and investments protects you from problems in the future and makes compound interest work for you, not against you.

And it is just cheaper to live without money problems. Pay the annual insurance without opting for the expensive option of monthly payments. Buy a mobile phone for cash if that’s cheaper than a contract.

Spot some canned goods on bargain offer – buy a year’s supply! And if you need some finance for a car or a house, it will be easier and cheaper.

Academics call this the poverty premium. But Bob Hope had a more catchy explanation: A bank is a place that will lend you money if you can prove that you don’t need it.

Of course paying off debt isn’t easy…

I’m not saying clearing debt is a piece of cake! But it really does get easier as you go along. If you have tried dieting and debt clearing, what do you think?

13 comments

Both are tough! I don’t like the word diet because it typically means a period of time. Once you’re done dieting, often people fall back into old eating habits and regain their weight. I believe it’s all about changing behavior and your mindset to be successful long term with health or debt.

Haha, I agree with Brian, neither dieting or paying debt are easy and the best way to approach is typically a whole-hearted lifestyle shift that will last longer than the time it takes to hit “debt free” or “goal weight”.

I was gonna say, I prefer getting out of debt much more over dieting. The issue is that you don’t need debt, but you DO need food to live. I think that’s why dieting is so freakin’ tough. But debt freedom is hard too, just in a different way.

Getting out of debt is much much easier I think because hunger is a real physical thing whereas wanting stuff is a mental concept and not triggered by a daily biochemical need. You can live forever basically without spending but you have to eat to survive so not eating means you are fighting your own instincts. The only way I found to control weight easily is to build your lifestyle around some serious activity. My slim wife and I distance run three days a week and play tennis five times a week and we have always been able to eat all we wanted without any weight gain. I guess that’s kind of like overcoming debt by earning so much that you can spend at will? Except that didn’t work for Johnny Depp.

I guess it depends on the person. I am very disciplined when it comes to finances but am the opposite when it comes to dieting! I definitely agree that the two have many similarities though. It’s best to change your entire mindset rather than thinking of dieting/saving as deprivation. Easier said than done of course.

I think there are learned behaviors in both areas that lead to outcomes we don’t like.

I also think that, like others have said, it takes a change of mindset to make true lasting progress – dieting forever is constricting and demoralizing, whereas choosing a healthy lifestyle is empowering. The same with finances – constantly having to restrict one’s budget is no fun, but if our mindset is one of achieving financial independence it changes our attitudes and therefore our behaviors.

” If you have tried dieting and debt clearing, what do you think?” I think you’re right! I have a very hard time saying “No” to sugar. One thing that makes it easier is to get past the withdrawal stage -then the temptations aren’t at all strong. But I have rarely made it past the withdrawal stage. A poor spending choice is much easier to recover from than caving in to a sugar-fest. I’ve had way more success with debt-repayment than I have with dropping sugar (and the 10-15 pounds I’d like to get rid of).

I’ve done both and, from personal experience, it was way easier to pay off debt than to diet!

The beginning was difficult, just like you said, but once I managed to put a budget in place and stick to it, it felt like I was paying off my debt on autopilot.

However, not being able to afford anything I actually wanted was kinda like opening the fridge and seeing a piece of chocolate cake.. You want to take a bite – because chocolate cake, yumm! – but you’d mock your progress so far if you do!